UK Strikes Deal To Grant Scotland More Powers To Counter Separatists

(Reuters) - Britain's main political parties struck what they said was a historic deal to grant Scotland tax-raising powers and greater autonomy to try to satisfy disappointed separatists who lost an independence vote two months ago.

The deal, which was unveiled on Thursday but will not be implemented until after a UK-wide parliamentary election next year, amounts to the biggest transfer of powers to Scotland from the United Kingdom since 1999 when a Scots parliament was set up.

Britain's three main political parties promised to grant Scotland more powers in a last-ditch attempt to shore up support for the union days before a referendum in September in which Scots ultimately spurned independence.

A step towards a federal Britain, they hope the deal will slake Scots' appetite for independence with the opposition Labour party banking on boosting its flagging support in a traditional stronghold in the face of the pro-independence Scottish National Party's surging popularity.

It's unclear whether it will revive their fortunes.

Speaking in Edinburgh, the Scottish capital, Robert Smith, the member of the upper house of the British parliament who wrote a report based on the deal, said it would lead to a devolved Scottish parliament that would be more powerful, accountable and autonomous.

"This gives the parliament more tools to pursue its own vision, goals and objectives whatever they might be at any particular time," he said.

"The recommendations set out in the agreement will result in the biggest transfer of power to the Scottish parliament since its establishment."

The proposals include giving Scotland the power to set income tax rates, some influence over welfare spending, and powers to decide how the Scottish parliament and other devolved political structures are selected and run.

Scotland would get the income from the taxes it raises with an adjustment in the spending currently made from London. It would also be given more borrowing powers though they have yet to be agreed with the British government.

Prime Minister David Cameron, who said after the 55-45 percent vote for staying in the union that the issue of Scottish independence had been settled for a generation, said he was delighted with the deal.

"We are keeping our promise to the Scottish people," he said.

But in a sign that nationalists would continue their campaign for full independence, John Swinney, a senior lawmaker from the Scottish National Party (SNP), said it didn't go far enough, although it still recognized Scotland's right to seek independence.

Scots nationalists have suggested they may push for another independence referendum if British voters choose to leave the European Union in a 2017 membership referendum that Cameron has said he will call if re-elected in 2015.

Legislation on Scotland's new powers is due to be drafted by the time Scots celebrate the birthday of their most revered poet, Robert Burns, on Jan. 25.